Issue - meetings

[Report of the Director of Finance. To be introduced by Cabinet Member for Finance and Strategic Regeneration]

The report will provide an update on the Quarter 2 budget monitoring and will seek approval for any revenue or capital budget changes required to respond to the changing financial scenario and the delivery of the MTFS.

The Cabinet Member for Finance and Strategic Regeneration provided an update on Medium Term Financial plan for 2020/21.The budget monitoring report covered the position at Quarter 2 (Period 6) of the 2020/21 financial year including General Fund (GF) Revenue, Capital, Housing Revenue Account (HRA) and Dedicated Schools Grant (DSG) budgets. The report focused on significant budget variances, including those arising as a result of the forecast non-achievement of Cabinet approved MTFS savings but more significantly, the impact that Covid-19 was forecast to have on the Council’s financial plans.

In response to questions from Councillor Dennison

• With regards to the waiver of parking restrictions in the lock down and resulting loss of income, this was not a mistake and was done with residents’ safety in mind. The Cabinet Member for Public Realm and Transformation added that this action was a government direction, supported by London Councils and the British Parking Association, and all London boroughs had followed this instruction. The local government compensation scheme recognised the connection of parking losses and the deterioration of Council budgets because of the lockdown 1. This was likely to be the reason that this instruction was not received for lockdown 2

• The levels of the Council’s reserves was information that was readily available, online, and the location of the published accounts could be provided.

RESOLVED

1. To note the forecast revenue outturn for the General Fund (GF), including the impact of COVID-19, and known and estimated levels of announcedCOVID-19 funding, is a net overspend of £9.8m (Q1 £23.1m). This is before any further emergency grant support (Section 6, Tables 1a and 1b, and Appendix 1). This excludes the DSG forecast.

2. To note that Directors have been asked to focus on actions to bring the forecast overspend down before the end of the year.

3. To note the net Housing Revenue Account (HRA) forecast of £4.2m (Q1 £9.6m) overspend (Section 6, Table 2, and Appendix 2).

4. To note the net DSG forecast of £5.3m (Q1 £4.6m) overspend, the actions being taken to seek to address this and the potential implications for the GF (Section 7 and Table 3).

5. To note the forecast budget savings position in 2020/21 which indicates that £7.3m (45%) (Q1 £8.3m (50%)) may not be achieved. (Section 8, Table 4 and Appendix 3). This is incorporated in the GF budget pressures addressed in recommendation 3.1 above;

6. To approve the proposed budget adjustments and virements to the capital programme as set out in Table 5 and Appendix 5 and note the forecast expenditure of £218m (£251m Qtr1) in 2020/21 which equates to 40% (43% Qtr1) of the revised capital budget (Section 9, Table 5 and Appendix 4);

7. To approve the budget virements as set out in Appendix 5; and

8. To note the debt write-offs approved in Quarter 2 2020/21 (Appendix 6).

Reason for Decision

A strong financial management framework, including oversight by Members and senior management, is an essential part of delivering the Council’s priorities and statutory duties. This is made more critically important than  ...  view the full minutes text for item 384